501(c)3 Nonprofits and Political Intervention and Speech
For tax-exempt 501(c)3 organizations, what speech is or isn’t ordinarily treated as participation or intervention in political campaigns? In 2007, the IRS issued Rev. Rule. 2007-41 to provide examples of what is treated and what isn’t treated as participation or intervention in political campaigns.
General RuleThe Johnson Amendment regulates tax-exempt organizations and prohibits 501(c)3 organizations from intervening or participating in political campaigns.
The general rule is that an organization cannot participate or intervene, directly or indirectly, in any political campaign on behalf of or in opposition to any candidate for public office. If your organization is found to be participating in any political campaign, it could lose its tax-exempt status.
To enforce this rule the IRS relies on a facts and circumstances test to determine if the actions of an organization are "on behalf of or in opposition to." This test means the IRS looks at every situation individually, but luckily in Rev. Rule. 2007-41, the IRS has provided some guidance on what it looks for.
Below is a list that summarizes the situations covered by Rev. Rule. 2007-41. However reading the full scenarios and consulting legal counsel will best help you avoid missteps.
Voter Education, Voter Registration, and Get Out the Vote DrivesNot Ordinarily Participation or Intervention - Non-partisan voter education activities are allowed.
Participation or Intervention - Biased voter education activities are prohibited.
Individual Activity by Organizational LeadersNot Ordinarily Participation or Intervention - Organizational leader speaks for themselves in an individual capacity on issues.
Participation or Intervention - Organizational leader makes comments in her or his official capacity on issues.
Candidate Appearances in His or Her Capacity as a Political CandidateNot Ordinarily Participation or Intervention - Organizations must give equal opportunity, discuss broad range election topics, and be moderated by an independent nonpartisan panel or moderator.
Participation or Intervention - Organization invites Candidates to 2 different events that are vastly different, topics are narrowed to fit Organization's political leanings, or moderators are biased during event.
Candidate Appearances as Non-CandidateNot Ordinarily Participation or Intervention - Organization invites Candidate to speak because he or she (i) currently or formerly holds a public office, (ii) is considered an expert in her or his field, or (iii) has lead a distinguishing career.
Participation or Intervention - Organization invites Candidate to speak because of (i)-(iii) but Candidate campaigns during event or is chosen solely for reasons related to candidacy.
Business ActivitiesNot Ordinarily Participation or Intervention - Organization's business activities must be available on an equal basis or the Organization charges candidates the usual rates.
Participation or Intervention - Organization provides only one candidate the benefits of its business activities.
Web SitesNot Ordinarily Participation or Intervention - Organization follows the same rules for its website as if it were written material, oral statements, or broadcasts.
Participation or Intervention - Organization links to political campaigns, does not have a purpose other than endorsement, and treats the website as if exempt from the IRS rules.